Free tool · Rules checked 2026-10-12
Credit card interest calculator: do your rewards cover it?
Every rewards calculator, ours included, assumes you pay in full. This one doesn’t. Enter the balance you carry and what you spend, and see a year of interest set against the rewards your card earns, including the grace period you lose on new purchases.
Published rate 21.99%. Change it if your statement shows another.
What you put on the card each month
CIBC · CIBC Dividend Visa Infinite
The interest costs more than the card earns.
Rewards a year
$432
Annual fee
$120
Interest on the balance
$440
Interest on new purchases
$351
Normally free: carrying a balance switches off the grace period.
Net a year
-$479
Net if paid in full
$312
On this spending, carrying any balance at all costs more than the card earns: the interest on new purchases alone outweighs the rewards after the fee.
Three ways to cut the cost
- Pay it down. Clearing the balance saves $791 a year. Every dollar paid off earns a guaranteed 21.99%, several times what any card pays back in rewards.
- Stop spending on this card while it carries a balance. Put new purchases on a card you pay in full each month and they’re interest-free again, which saves $351 a year. The rewards move with the spending.
- Move the balance to a lower rate. On the National Bank Syncro Mastercard, whose standing balance-transfer rate is 12.9%, the same balance costs about $258 a year in interest, plus its $35 fee, instead of $440: about $147 less, before any transfer fee. See every option in our best low-interest credit cards, including 0% balance-transfer offers.
Rewards use each card’s published earn rates and caps, valued at our Points Standard Index, with no welcome offer: a carried balance costs money every year, and a bonus pays once. Interest is simple interest at the annual rate on a balance that stays the same, with the interest paid each month. In a month you carry a balance, new purchases are charged interest for about 36 days (from the purchase date to the due date). On a card with more than one reward plan, rewards use the plan you pick, or the one that earns most. A moved balance is priced at the new card’s standing balance-transfer rate, not a promotional one. Cash advances and fees such as late charges are left out.
The cost most people miss
Interest on the balance is the part everyone expects. The second cost is quieter. Pay a statement in full and that month’s purchases are interest-free until the due date. Leave anything unpaid and that stops: new purchases start charging interest too.
At 21.99%, a $2,000 balance costs about $440 a year. Keep putting $1,350 a month on the same card and the new purchases add about $351 more outside Quebec ($205 in Quebec, where interest starts at the statement date rather than the purchase date). That’s $791 a year, more than most rewards cards return on that spending.
A year of interest on a carried balance
| Balance carried | At 21.99% | At 21.99%, still spending $1,350/mo | At 8.9% |
|---|---|---|---|
| $1,000 | $220 | $571 | $89 |
| $2,500 | $550 | $901 | $223 |
| $5,000 | $1,100 | $1,451 | $445 |
| $10,000 | $2,199 | $2,550 | $890 |
21.99% is the published purchase rate on 52 of the 106 cards here; 8.9% is the lowest purchase rate, on the National Bank Syncro Mastercard, a variable rate that moves with prime. Interest is simple interest at the annual rate, outside Quebec, before any annual fee.
Getting out from under it
Pay down the most expensive balance first. Every dollar off a 21.99% balance earns 21.99%, guaranteed. No rewards program pays anything like that. To see how long a payment plan takes, the federal government’s credit card payment calculator works it out month by month.
Split the jobs. Leave the balance on one card and stop spending on it. Put everyday purchases on a card you pay in full each month, so they stay interest-free and keep earning. Our card value calculator prices that second card on your spending.
Move the balance to a lower rate. A standing low-rate card or a 0% balance-transfer offer can cut the interest sharply, but transfers usually carry a fee, the promotional rate ends, and a transferred balance is charged the card’s balance-transfer rate, which can be well above its purchase rate. Our best low-interest credit cards ranking compares both.
Rewards math assumes you pay your balance in full every month — interest charges quickly exceed any rewards value.
Frequently asked questions
How much interest will I pay on my credit card balance?
A year of interest is roughly the balance times the rate. At 21.99%, the most common purchase rate on our list, a $2,000 balance carried all year costs about $440. If you keep spending on the same card, add the interest on new purchases: about $351 more on $1,350 a month, because carrying a balance switches off the interest-free grace period.
What is the grace period on a credit card in Canada?
At least 21 days from the statement date to pay for that month's purchases without interest. Federally regulated issuers must offer it, and so must issuers under Quebec's Consumer Protection Act. It only applies when you pay the statement in full by the due date. Cash advances never get a grace period.
Do I pay interest on new purchases if I carry a balance?
Yes. Outside Quebec, if you don't pay in full by the due date, interest is charged on purchases from the day you made them until they're paid, about 36 days on average. In Quebec, interest on an unpaid balance runs from the end of the statement period instead, about 21 days. Either way, purchases that would have been free start costing money.
Is a rewards card worth it if I carry a balance?
Rarely. Rewards cards charge 21.99% or so, and on typical spending the rewards come to a few hundred dollars a year. Carry a few thousand dollars and the interest usually matches or beats them. On $1,350 a month and a $2,000 balance, not one personal card on our list comes out ahead. Pay the balance down, stop spending on the card that carries it, or move it to a low-rate card.
Does paying the minimum stop interest?
No. The minimum payment keeps the account in good standing and avoids a late fee, but interest is still charged on everything you leave unpaid. In Quebec the minimum payment is at least 5% of the balance; elsewhere, the issuer sets it in your cardholder agreement.
What's the lowest credit card interest rate in Canada?
On our list, the National Bank Syncro Mastercard at 8.9%. Our low-interest ranking compares every low-rate card by fee plus interest on a carried balance, along with 0% balance-transfer offers.
Rules checked 2026-10-12 against the Financial Consumer Agency of Canada’s How credit cards work and the Office de la protection du consommateur’s pages on payments under variable credit and the minimum payment. Card rates are each issuer’s published purchase rate, from our card reviews; your own rate is on your statement. Your cardholder agreement sets the exact terms.